Two in-court options for dealing with financial distress of a firm are:
A) Merger and acquisition
B) Liquidation and reorganization
C) Leasing and LBO
D) Issue stocks and bonds

Question

Quizplus · Accepted Answer

Liquidation and reorganization are the two main options for dealing with the financial distress of a firm. Liquidation involves selling all the assets of the company and distributing the proceeds to creditors and shareholders, while reorganization involves restructuring the company's debt and operations to continue the business. It is often the best choice because it allows the company to continue operating and potentially recover, while providing some degree of relief to creditors and shareholders. Merger and acquisition, leasing and LBO, and issuing stocks and bonds may also be options, but they are not typically used as the primary in-court options for dealing with financial distress.

Two In-Court Options for Dealing with Financial Distress of a Firm